Miller Value Partners, an investment management company, released its “Deep Value Strategy” first-quarter 2025 investor letter. A copy of the letter can be downloaded here. The year 2025 has been unpredictable. After setting new highs in mid-February, the market saw a double-digit decline towards the end of the quarter, capping off a strong start to the year. As the administration implemented global tariffs, sentiment swiftly deteriorated due to growing economic uncertainty. In the quarter, the Deep Value Select strategy had a -12.8% drawdown compared to -.2% return for the S&P 1500 Value Index and -9.9% return for the S&P 600 Value Index. In addition, please check the fund’s top five holdings to know its best picks in 2025.
In its first-quarter 2025 investor letter, Miller Value Deep Value Strategy highlighted stocks such as JELD-WEN Holding, Inc. (NYSE:JELD). JELD-WEN Holding, Inc. (NYSE:JELD) engages in the design, manufacture, and sale of wood, metal, and composite materials doors, windows, and related building products. The one-month return of JELD-WEN Holding, Inc. (NYSE:JELD) was -15.55%, and its shares lost 72.55% of their value over the last 52 weeks. On April 22, 2025, JELD-WEN Holding, Inc. (NYSE:JELD) stock closed at $5.16 per share with a market capitalization of $440.486 million.
Miller Value Deep Value Strategy stated the following regarding JELD-WEN Holding, Inc. (NYSE:JELD) in its Q1 2025 investor letter:
“During the quarter, we made a new investment in an attractively priced building supplier. JELD-WEN Holding, Inc. (NYSE:JELD) is a leading North American. and European manufacturer and distributor of interior and exterior doors and windows to new construction and remodeling sectors. JELD-WEN share price has been under significant pressure, 73% below its 52-week high as the company has experienced revenue and profit weakness. The company is undertaking a multi-year transformation bringing in automation and system enhancements to enhance their manufacturing and warehouse footprint. Since 2023, new senior management has removed $350M from their cost structure and management expects $100M/year in further productivity savings. As they rationalize their infrastructure over the next five years there is significant capital efficiency improvement potential. In addition, like our investments in Quad Graphics (QUAD) and United Natural Foods (UNFI), JELD-WEN owns real estate, which provides significant margin of safety for the transformation plan. While the company expects margins and profits at historical trough levels in the early part of 2025, a new cost reduction program should support margin and profit improvement later in the year. Near-term risk is a weaker housing and remodeling marketplace, causing greater near-term revenue weakness and a slower recovery in company margins. Long-term positive supply and demand dynamics (favorable demographics and limited supply) should shorten the current downturn. In addition, there was a recent market transaction that bolsters our view JELD-WEN’s significant embedded value proposition. Owens Corning acquired Masonite International (interior/exterior doors) in May 2024 at 8.6x EV/EBITDA. JELD WEN should be a beneficiary of any housing recovery with 25-30% incremental margins on a future volume improvement. Long-term upside potential from their transformation plan supports the goal of achieving double digit normalized EBITDA margins and could realistically support a share price multiples the current price level.”
A closeup of a residential wooden door, showcasing its elegant craftsmanship.
JELD-WEN Holding, Inc. (NYSE:JELD) is not on our list of 30 Most Popular Stocks Among Hedge Funds. Our database shows that 18 hedge fund portfolios held JELD-WEN Holding, Inc. (NYSE:JELD) at the end of the fourth quarter, compared to 13 in the third quarter. While we acknowledge the potential of JELD-WEN Holding, Inc. (NYSE:JELD) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we covered JELD-WEN Holding, Inc. (NYSE:JELD) and shared the list of worst-performing construction stocks. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.